Announcement of World Bank Approves Eighty-Five Million Dollars for Livestock Project in Romania on November 1, 1979

FOR IMMEDIATE RELEASE •World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 80/18 November 1, 1979 WORLD BANK APPROVES $85 MILLION FOR LIVESTOCK PROJECT IN ROMANIA Production of poultry in Romania is expected to increase substantially as a result of an $85 mill ion loan approved by the World Bank. The project, which has a total cost of $311.4 mill ion, will provide for construction of 37 broiler breeding farms, each with an annual capacity to produce 6.6 mill ion broiler chicks, and 28 mechanized broiler production farms, each with an annual capacity of 4,100 tons of poultry meat. The latter will use new mechanized cage technology which facilitates an output of 3.3 times that of the traditional deep 1 itter production system. • A further 20 production farms will be modernized, and 15 poultry slaughter- houses with an average kill rate of l ,000 chickens an hour will be constructed. Importation of pedigreed stock will improve the breeding of the current Romanian poultry stock, and equipment will be installed for improved quality control and disease isolation and control. The project is expected to create jobs for about 9,000 people. Development of Romania's livestock subsector has given priority to increasing meat exports to generate much needed foreign exchange, with less emphasis on satisfying domestic demands. This project, however, is designed to help fulfill domestic demand under a program aimed at making each district (judet) in Romania self-sufficient in poultry products. At full development of the project, 0nnual chicken meat output is expected to increase by 157,000 tons 1 iveweightj and by about 124 million day-old chicks or hatching-eggs. Per capita poultry meat consumption in Romania is expected to increase from 11 kilograms (kg) in 1978 to about 18 kg in 1985. The World Bank loan to the Bank for Agriculture and Food Industry (BAFI), to be guaranteed by the Socialist Republic of Romania, is for 15 years, including 3 years of grace, with interest at 7.95% per annum. Substantial co-financing from foreign commercial banks is at an advanced stage of negotiation . • NOTE: Money figures are expressed in U.S. dollar equivalents. FORM NO. 1121 (5-76) T ECHN I CAL D A T A PROJECT: COUNTRY: TOTAL COST: Third Livestock Socialist Republic of Romania $311.4 million • BA~K FINANCING: $85 million for 15 years, including 3 years of grace and an interest rate of 7.95% per annum. OTHER FINANCING: Subborrowers' contributions: $27. 1 mill ion. Bank for Agriculture and Food Industry~ $99.3 mill ion. Syndicated loan from private foreign commercial banks: $100 mill ion (To be arranged. Currently at an advanced stage of negotiations.) IMPLEMENTING ORGANIZATION: Bank for Agriculture and Food Industry (BAFI), Strada Smirdan No. 3, Bucharest, Romania. (Cable address: AGROBANK, Bucharest, Romania; Telex 11622 AGBANC R.) PROCUREMENT ORGANIZATION: Romanian Foreign Trade Company for Agriculture (ROMAGRIMEX), Str. Alex. Sahia 16, Bucharest, Romania (Cable address: ROMAGRIMEX, Bucharest, Romania. • Telex 11522 or 11693 ROMEX R.) PROJECT DESCRIPTION: Agricultural credit subprojects to be financed under the loan will include investments to be undertaken in 1980-83 for: 37 new broiler breeding farms; modernization of 20 broiler production farms; 28 new mechanized ,broiler production farms; 15 new poultry slaughterhouses; provision of specialized equipment for quality control, applied research, disease control, and per- formance standards improvement; and infusion of current pure 1 ive breeding stock with imported pedigreed stock. PROCUREMENT: Construction of project facilities will be carried out by Romanian construction enterprises. List of iter.,s estimated to cost $83 mill ion will be procured by ROMAGRIMEX under international competitive bid- ding in accordance with Bank guidelines. These items include concrete refinforcing steel ($8.76 million), structural steel ($6.34 million), steel pipes ($2.81 million), electric cables ($9.9 mill ion), steel sheets ($2.73 million), ~sbestos sheets ($2.2 mill ion), and slaughterhouse and meat processing equipment ($50.26 mill ion). Romanian manufacturers will be accorded a preference of 15% of the c. i .f. price or the applicable customs duty (whichever is lower). Laboratory equipment, biological products and pedi- greed breeding costing $2 mill ion will be procured under prudent international shopping. It is anticipated that foreign suppliers will be awarded contracts for about $3.8 mil- lion mainly for slaughterhouse and specialized laboratory equipment not manufactured in • Romania. ECONOMIC RATE OF RETURN: 12% ESTIMATED COMPLETION DATE: 1987 - 0 -